Union Watch Highlights

Motown’s Mental Breakdown: As unions and the city council resist reform, bankruptcy looms for DetroitEditorial, December 3, 2012, Wall Street Journal
The political gospel according to Democrats is that the auto bailout saved Detroit. If only it were so. Alas, costly labor agreements have driven Motown like GM and Chrysler to disrepair. Perhaps the only fix now is to let Detroit go bankrupt. Michigan lawmakers have kept Detroit on life support for the past six months and may need to do so indefinitely barring a miraculous economic recovery. The city will run out of cash this month unless the state releases $30 million in bond proceeds, which are being held in escrow under a consent agreement that council members reluctantly approved in April. The rescue package ties $137 million in state aid to reforms and lets Mayor Dave Bing redo labor contracts. (read article)

Unions Spend Big in State CampaignsBy Sam Hananel, December 3, 2012, Topeka Metro News
From California to Maine, unions used their political muscle in the recent elections to help install Democratic governors, build labor-friendly majorities in state legislatures and defeat ballot initiatives against them. The combination of union money and member mobilization helped Democrats take control of state legislatures in Maine and Minnesota. In Michigan, voters repealed a law that allowed cities in financial distress to suspend collective bargaining contracts. But unions lost there on an effort to make collective bargaining rights a part of the state constitution. In New Hampshire, unions helped Maggie Hassan win the governor’s race. Unions spent millions backing Hassan with television ads and an extensive get-out-the-vote operation because she opposes a right-to-work bill to ban labor-management contracts that require affected workers to be union members or pay union fees. In perhaps their most important victory, unions defeated a California ballot measure that would have prohibited them from collecting money for political purposes through payroll deductions. “The unions must be fairly happy with themselves,” said Gary Chaison, professor of industrial relations at Clark University in Worcester, Mass. “These are positive signs, particularly saving their political life in California.” (read article)

Union vultures on the prowlSusan Stamper Brown, November 3, 2012, Delaware Online
So what do you get when you cross a community organizer-turned-president with union thugs? No one is really sure — yet, but one thing is for sure, Congressional Democrats have every reason to be afraid. President Obama’s BFFs have them in their sights and promise to strong-arm them into submission should they dare compromise on the fiscal cliff. On MSNBC just before Thanksgiving, United Steelworkers Union boss Leo Gerard said any Democrats compromising with Republicans will suffer the same fate as former senator Blanche Lincoln (D-Ark.), the last of a dying breed of moderate Democrats. Gerard said those who compromise are not “real Democrat[s],” proof that extremists have taken over the Democrat Party. It should come as no surprise to anyone that some of the most frequent White House guests are union bosses. Granted, there was a time when union bosses were considered the “good guys” looking out for the working class, but somewhere along the way they’ve become the epitome of the very things they once fought against. Even still, President Obama continues to consult with labor leadership regarding job creation and economic issues as he recently did November 13. AFL-CIO President Richard Trumka walked away saying he was pleased with the outcome, and now we hear labor unions are investing big union dollars to promote President Obama’s tax the rich propaganda. And, in return? According to the Washington Examiner, the National Labor Relations Board (NLRB) is working on a special rule forcing non-union employers to disclose to union organizers the private contact information of workers in order to facilitate union expansion. (read article)

Giant port of Los Angeles shut down by clerical workers who turned down $190,000 a yearEditorial, December 1, 2012, Orange County Register
Cold seawater was thrown on the fragile U.S. and California economic recoveries last week as the International Longshore and Warehouse Union Local 63 Office Clerical Unit struck at the Port of Los Angeles and the Port of Long Beach, which, combined, are America’s largest port complex. The bargaining unit comprises only about 800 workers. “Other longshore bargaining units refused to cross [picket] lines, and no cargo at the nine affected terminals was unloaded or loaded after the strike began,” the Los Angeles Daily News reported. “Officials said shipping lines were either sending ships to other ports or having them wait off the coast.” At issue is the replacement of a contract that expired in 2010. Cargo ships were stacking up at the ports of Los Angeles and Long Beach as a strike by about about 70 clerical workers shut down most of the terminals that together are the nation’s busiest port complex. Dockworkers were refusing to cross the picket lines even though an arbitrator ruled the walkout invalid on Tuesday. By Thursday morning, at least 18 ships docked and inside the adjacent harbors were not being serviced, port spokesmen said. Bloomberg News reported, “The employers said … that clerical workers rejected a proposed increase in compensation to more than $190,000 in wages and benefits.” (read article)

With Los Angeles pension initiative dead, unions focus on spring electionsBy Rick Orlov, December 1, 2012, Daily News
The decision by former Mayor Richard Riordan last week to suspend his pension reform campaign continued to resonate at City Hall as a city union took one last blast at the former mayor. SEIU Local 721, one of the city’s major employee unions, divulged one of its anti-Riordan campaign strategies last week when it said more than 10,000 people who signed the Riordan petition later asked to have their names withdrawn. To no one’s surprise, a number of those people were city workers. While none signed with false names and addresses – as had been suggested in a disputed campaign memo – it still would have presented a problem for Riordan in trying to qualify his measure for the ballot. Riordan’s aides estimated he had spent $500,000 and had collected about 100,000 of the 265,000 signatures needed. He suspended the campaign because of the difficulty in getting all the signatures by the end of this month to qualify for the ballot. With no pension ballot initiative to fight, the unions can re-focus their energy and their money on the races for mayor, controller, city attorney and the City Council. In all, nine of the 15 City Council seats will be decided this coming year. “We are more freed up now,” said one union official. “We can start taking a closer look at the races.” (read article)

Lost in Louisiana: A judge sides with unions against education opportunityEditorial, December 3, 2012, Wall Street Journal
Louisiana Judge Timothy Kelley sure is a fast writer. Only hours after the end of a two-day trial, the Balzac of the judiciary rolled out a 39-page opinion striking down the state’s pioneering voucher program as unconstitutional. Could it be that he knew how he was going to rule before the trial? The state district judge in Baton Rouge ruled that the program is illegal because it pays for the vouchers through the state’s Minimum Foundation Program, which “equitably distributes” state funds for individual school districts. He conceded that the vouchers are intended to help students escape awful schools, but he said this “ignores the good of the individual students who are left behind in those schools deemed underperforming.” In other words, better that all students fail together, rather than let parents take the money that is supposed to go to public education and try to get their child actually educated. (read article)

Teacher union scored big in school, college races in San Diego CountyBy Mark Walker, November 30, 2012, San Diego North County Times
The American Federation of Teachers continues to expand its clout on school and community college boards in San Diego County, spending hundreds of thousands of dollars this election season to get at least 11 of its candidates elected. In many cases, the union recruited the hopefuls, paid their filing fee and then deluged voters with mailers and phone calls critical of targeted incumbents. Union-backed candidates — mostly teachers or professors — and their supporters say they bring the perspective of classroom experience to policy-making panels while critics warn of possible undue influence during contract negotiations. Several defeated incumbents caught in the AFT cross hairs complain the union mailers were wildly inflammatory and devoid of policy issues. “They were nothing but hit pieces,” said John Witt, defeated by union-backed Gregg Robinson after four terms on the county Board of Education. (read article)

School Districts Ride Capital Appreciation Bonds (CABs) to the PoorhouseBy Mike Antonucci, November 29, 2012, Education Intelligence Agency
We don’t get much of this type of investigative reporting into school finances, so we cheer Dan Weikel of the Los Angeles Times for this piece on California school districts and their investment in capital appreciation bonds (CABs). CABs are the kind of deal you get from the local leg-breaker when you have tapped out all your other sources of credit. They allow you to put off your first payment for years, in exchange for the exorbitant compounded interest they accumulate. Weikel found 200 school districts that borrowed $2.8 billion in CABs, which will end up costing $16.3 billion when they are due. (read article)

Hostess unions line up with Wall Street asset strippersBy Jerry White, November 29, 2012, World Socialist Web Site
A week after a US bankruptcy court approved the liquidation of Hostess Brands, a slew of private equity firms and buyout specialists are seeking to cash in on the carve-up of the 82-year-old baked goods maker. On November 21, Hostess announced it was locking the gates at its 33 bakeries and hundreds of other facilities around the US, getting rid of its 18,500 workers and canceling payments to its pension funds. Among the companies reportedly bidding for the Hostess’ assets are Flower Foods, private-equity firm Sun Capital Partners, liquidation firm Great American Group and C. Dean Metropoulos & Co., whose owner last month said that “shedding the complications of the unions and old plants makes it even more attractive.” The players involved also include the trade unions, particularly in the Teamsters and the Bakery, Confectionary, Tobacco Workers and Grain Millers (BCTGM), which are functioning essentially as instruments of rival private equity and hedge fund interests. (read article)

Louisiana Voucher Test: Meet 11-year-old Gabriel Evans, teachers union enemy No. 1Editorial, November 28, 2012, Wall Street Journal
Here’s the bizarre world in which we live: In 2007 Gabriel Evans attended a public school in New Orleans graded “F” by the Louisiana Department of Education. Thanks to a New Orleans voucher program, Gabriel moved in 2008 to a Catholic school. His mother, Valerie Evans, calls the voucher a “lifesaver,” allowing him to get “out of a public school system that is filled with fear, confusion and violence.” So what is the response of the teachers union? Sue the state to force 11-year-old Gabriel back to the failing school. (read article)

The Media Choke on a Twinkie: Why nobody is allowed to hear what the bakery union is sayingBy Holman W. Jenkins, Jr., November 28, 2012, Wall Street Journal
Hardly any business in America is less consequential than Hostess, and yet Twinkies have garnered a disproportionate share of media focus and we are about to recommit the sin of over-attention here. Our most fervent wish for the journalism profession for a long while has been that a new generation would come along trained to think. The world is adequately stocked with journalists who can write, who are careful and accurate reporters, and yet are helpless as babies when asked to punch their way through an obvious fallacy. Hostess has been enveloped in arguments about whether management or labor is to blame for the company’s downfall. You can guess where most treatments come down. Management did not invest enough in new products or upgraded software or new trucks. Begged by these indictments is the question of whether managers stupidly refused to make profitable investments or were somehow incentivized to prefer losing money. If not, one might have to entertain the possibility that management was doing the job of management, withholding investment in a business model that would not return that investment with a profit. (read article)

Sacramento SEIU Local 1000 critic discusses union financial recordsBy Jon Ortiz, November 28, 2012, Sacramento Bee
Mariam Noujaim, a dues-paying critic of Service Employees International Union Local 1000, said Tuesday the organization spends too much on travel and dining. Noujaim has engaged in a two-year legal battle to review SEIU internal records, which a judge enabled her to do Tuesday in Sacramento. The Bee detailed her effort in Monday’s paper, and caught up with her Tuesday after she sifted through records. The union has declined to comment on Noujaim’s efforts. (read article)

California Correctional Peace Officers’ spending focus: Beat Prop. 32, support Prop. 30By Jon Ortiz, November 28, 2012, Sacramento Bee
Political spending by the California Correctional Peace Officers Association reflects how public employee unions faced a divided political battle on the Nov. 6 ballot. The 30,000-member prison and parole officer union’s Truth in American Government Fund split $700,000 of the $1 million it spent between two efforts: $350,000 went to Gov. Jerry Brown’s Yes on Proposition 30 campaign and another $350,000 to Joe Slade White & Co. The union independently tapped the New York-based communications firm to to work up an ad campaign against Proposition 32, the money-in-politics measure that voters rejected on Nov. 6. Another CCPOA PAC gave $110,000 to the California Democratic Party and $15,400 to the Calfornia Republican Party. (read article)

Teachers Strike Against StudentsBy Bob Adelmann, November 27, 2012, Light from the Right
Just in case you missed it, the teachers at Old Rochester Regional Junior High School have revealed their immaturity and pettiness, and, I might add, their agenda: they went on strike against their own students. It seems that the teachers’ union has balked at signing a collective bargaining agreement with the school board for the past two years and the teachers are feeling put upon to continue to work (and get paid) without a contract. To protest this “outrage” they decided to leave the building when the kids wanted to serve Thanksgiving Day meals to local senior citizens. (read article)

The real reason unions are targeting Wal-MartBy Diana Furchtgott-Roth, November 27, 2012, Washington Examiner
Wal-Mart employees may not know this, but the United Food and Commercial Workers International Union, which organized Black Friday’s “strikes” outside their stores, has a serious problem. Its pension funds are failing. Most are in critical status (defined as less than 65 percent funded) or in endangered status (less than 80 percent funded), according to the union’s own reports to the U.S. Labor Department. Without an infusion of new cash, they will not be able to pay all their obligations to future retirees. That’s why the UFCW seeks to sign up 1.4 million Wal-Mart employees — to inject fresh money into its failing plans. This union, with 1.3 million members in North America, has been unsuccessfully battling for years to organize Wal-Mart, the world’s biggest retailer. (read article)

About the author: Jack Dean is editor of PensionTsunami.org, formed to monitor developments in all three pension spheres nationwide — public employees, corporations and social security. PensionTsunami, like UnionWatch, is a project of the California Public Policy Center. Dean is a former newspaper editor and a past executive director of the Reason Foundation. He has been active in politics for more than three decades and currently serves as president of the Fullerton Association of Concerned Taxpayers.